Too little inequality means there is nothing to strive for, the ambitious won’t have much reward to work for.
Too much inequality means too few participants in the economic decision making process which leads to instability (i.e. the mad king phenomenon). We are getting closer to the point of instability now, as we reach higher levels of inequality.
How much do you think was the reward that set in motion all the free and open source software that underlie the many OSes, DBs, and dev tools that we still use for free today?
Fair amount? Yes, many started out as someone messing around but paid developers funded by commercial entities followed most of successful open source we use today.
So then we have proof by example that money is not a necessary incentive for people to create, no? And even if the FOSS projects eventually evolved into foundations that solicit some form of funding, they’re still mostly non-profits that are collecting just enough money to sustain their continued operations and aren’t really chasing profits and growth like regular companies do.
Money was exactly what allowed FOSS projects to succeed. Developers with a day job have enough free time to do their own projects for their own reasons.
Ambition, with respect to wealth, can be a double-edged sword. One can imagine being both ambitious and allowing everyone to share in the benefits, and the act of participating in some advance as its own reward. Those that do gain some advantage often are hiding the tremendous work of others, gaining a grotesque share of the fortune for their being in the right place and time. To paraphrase a scene from Life of Brian, it is the (so-called) ambitious, often, who are the problem.
> Too little inequality means there is nothing to strive for, the ambitious won’t have much reward to work for.
That kind of "ambition" is greed. There are other forms of currency that are arguably much more desired to a healthy society and don't go away in a more equal society: reputation, respect, intellectual authority, etc.
> There are other forms of currency that are arguably much more desired to a healthy society and don't go away in a more equal society: reputation, respect, intellectual authority, etc.
Those doesn't scale though, most jobs doesn't award you any of those. Money is the only real reward low status jobs has gotten ever, take that away and why would anyone wanna work low status jobs?
No, but if we build a society where inequality ceases to be an issue, jobs will stop rewarding greed and start rewarding whatever other currencies attract the best talent.
Similarly, entrepreneurship will be based on those currencies.
Money is a human construct. Inequality is a human construct. Neither are a requirement for the existence of humanity or for humans to thrive.
> if we build a society where inequality ceases to be an issue
Looking back through history, there's always jerks who ruin this, being equal isn't enough: either they want to have more money than, and power over, everyone else; or they explicitly want others to suffer, usually people who look different.
Dealing with those personalities has cost us trillions of dollars throughout human history, but it keeps happening, because you can't evolve better brains in the few thousand years humans have been civilized.
It's very interesting to see how people's imaginations are so captured by propaganda that they don't allow themselves to even consider that societies may be based on things other than money, profit and greed.
Talking about the putative dangers of "too little inequality" when the amount we have today is so absurdly high seems kind of disingenuous, even if that's not what's intended.
In order for there to be "too little inequality" to the extent that you describe, it would have to be impossible for anyone to, say, earn more than about $100k/yr (based on current median incomes in the US). So far as I know, no one with an iota of credibility has proposed anything remotely like this.
As it stands, any time any level of increase in taxes on the ultra-wealthy is proposed, people come out of the woodwork claiming that a higher tax rate on those making $100m, $500m, $1b/yr would just destroy all interest in striving and doing well, which is so clearly absurd.
...And, unfortunately, we also know that there are a fair number of people for whom reduced inequality would destroy their ambition, because their ambition has nothing to do with being reasonably wealthy themselves or having financial security: the reward, for them, is very explicitly being able to treat other people like they aren't even human. And that's not something society should ever accept, from anyone.
Too much inequality means too few participants in the economic decision making process which leads to instability (i.e. the mad king phenomenon). We are getting closer to the point of instability now, as we reach higher levels of inequality.